Has anyone tried this yet? I haven't because my experience in the past has been that when using smart previews the option to edit in Photoshop was not available. How is this handled in this new update?

Whats new is you can have your photos on an internal drive or NOT unplug your external drive to be able to get the speed advantage of Smart Previews. Smart previews were only available when the originals were offline so having your photos on an internal negated the use of them. I tried it and it works great. I don't have the fuzzy 1:1 zoom like Jim Hess. I probably will not need the feature on my new iMac as I have no complaints about performance (although more speed is always nice) but may try it when I am using my 2010 iMac as it is a little slow. It would have been 200% better if they would have put a "use/not use" smart preview switch on the toolbar instead of putting it in preferences so you could easily switch back and forth but I will just create the smart previews when I need them.

Just to clarify, I didn't say the 1:1 previews were fuzzy. They just aren't as sharp. It is noticeable and frustrating when trying to accurately sharpen an image. And frankly, I didn't experience that much of a performance boost. I might take a look at the feature later. But I'm happy not using it right now.

Whats new is you can have your photos on an internal drive or NOT unplug your external drive to be able to get the speed advantage of Smart Previews. Smart previews were only available when the originals were offline so having your photos on an internal negated the use of them.

OK, that makes sense. So which is better, faster (cheaper?) Smart Previews or Fast Load Previews for DNG? For those of us using DNG and for those of us who don't care about off line previews?

Well, I just put my glasses on and took another look at the new smart preview option. All I can say is that I had better wear my glasses a little more often. I too find the smart previews as sharp as the "regular" previews. I'm just wondering if this is going to gobble up a lot more disk space.